The recent admission by a major mortgage lender that it has filed dubious foreclosure documents is likely to fuel a furor against hasty foreclosures, which have prompted complaints nationwide since housing prices collapsed.
Lawyers for distressed homeowners and law enforcement officials in several states seized on revelations by GMAC Mortgage that it had violated legal rules in its rush to file many foreclosures as quickly as possible.
Florida lawyers said they would start filing motions to have hundreds of foreclosure actions dismissed; the attorney general in California has directed the company to suspend all foreclosures in that state.
Attorneys general in Iowa and North Carolina said they were also beginning separate investigations of the lender.
The federal government, which became the majority owner of GMAC after supplying $17 billion to prevent the lender’s failure, has told the company to clean up its act.